Slide 9.1 Chapter Culture and corporate strategy Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.2 Strategy and corporate culture • The relationship between company culture and strategy: – Is strategy a product of culture? – Is culture a product of strategy? Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.3 Cultural factors of strategy In what way is the formulation of strategy affected by cultural differences? (Fatehi, 1996): •Relationship with the environment – Mental framework of two types of persons: • ‘engineering-oriented’ • ‘symbiotic-oriented’ •Relationship among people – Interpersonal relationships within a company: • Differences among employees towards a company’s strategy (e.g between US and Japan) Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.4 Effect of national culture on strategy In what way can national culture affect strategy? • Leadership and decision-making – the choice of strategy – the way it is realised • Impact of national structure on strategy – sector of products and services • Multinational and its local subsidiaries – culture differences in foreign markets Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.5 National culture and corporate strategy • Importance of the country manager because he/she: – Defends the company’s market decisions – Satisfies the demands of the local subsidiary – Assumes the role of ‘cultural interpreter’: • gives information about the national situation; • understands the corporate goals and values Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.6 Global market strategy • Global assignments can be very important strategically for the company • The international manager has to: – Gain insight into the attitudes of those involved in a cross-cultural situation – Modify his/her management strategy • This means: – Not having the same strategy whatever the circumstances – Applying skills in one context to another Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.7 Culture shock • Culture shock refers to unpleasant experiences with other cultures • International managers experience culture shock at three levels: – Emotions – Thinking – Social skills and identity • Culture shock phase is an integral part of the adaptation phase (Marx,1999) Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.8 International company strategy • Kinds of co-operation: from mergers and takeovers to joint ventures, alliances and partnerships • A merger of two companies: – Presupposes a change of ‘culture’ in the new organisation • From different countries: – Increasing complexity of exchanges of interaction between cultures – Other organisational problems arise due to inevitable change of culture(s) involved Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9.9 Conclusion • National culture influences a company’s strategy • Organisational culture is a part of the strategy • In the process of strategy development lie the same levels as in culture • Not only does the organisational culture change but also the company’s strategy • Difficulties with all kinds of co-operation on the cultural front, particularly in cross-border M&As • Going to work abroad implies a cross-cultural adaptation End Browaeys and Price, Understanding Cross-Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 ...Slide 9. 2 Strategy and corporate culture • The relationship between company culture and strategy: – Is strategy a product of culture? – Is culture a product of strategy? Browaeys and Price,... Understanding Cross- Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9. 3 Cultural factors of strategy In what way is the formulation of strategy. .. company’s strategy (e.g between US and Japan) Browaeys and Price, Understanding Cross- Cultural Management PowerPoints on the Web, 3rd edition, © Pearson Education Limited 2015 Slide 9. 4 Effect